2020 IL App (3d) 190128
Ill. App. Ct.2021Background
- In May 2006 James and Dannette Bell executed a mortgage; only Dannette signed the note. MERS was nominated as mortgagee for ResMAE (the original lender).
- On June 30, 2006 MERS recorded a satisfaction/release stating the mortgage was paid; on July 19, 2006 MERS recorded a "certificate of error" disavowing that release and a second recording of the mortgage followed.
- Dannette died in July 2009. MERS (as nominee) assigned its interest in the first-recorded mortgage to JP Morgan Mortgage Acquisition in April 2010; JP Morgan filed foreclosure May 3, 2010.
- After subsequent assignments the plaintiff became Bayview. In 2017–2018 competing cross-motions for summary judgment were filed: the trial court granted Bayview’s SJ, entered foreclosure, sale, eviction, and an in rem deficiency; James appealed.
- The appellate court found genuine factual disputes concerning the recorded release and the certificate of error, vacated Bayview’s summary judgment and downstream orders, affirmed denial of James’s SJ, and remanded for further proceedings (including resolution of standing and James’s motion to amend).
Issues
| Issue | Plaintiff's Argument (Bayview) | Defendant's Argument (James) | Held |
|---|---|---|---|
| Subject-matter/necessary parties after mortgagor's death | Section 15‑1501 allows proceeding without special representative where surviving tenant by entirety exists; dismissal of Dannette did not deprive jurisdiction | Dannette was a necessary party; dismissal rendered proceedings void under McGahan | Court: Jurisdiction proper under §15‑1501(h); affirmed on this point |
| Legal effect of 2006 release vs certificate of error | The June 2006 release was a mistake; the July 2006 certificate of error lawfully corrected the record and revived the lien | The June 2006 release permanently extinguished the mortgage; the certificate of error cannot revive a released lien | Court: Genuine disputed facts exist from the conflicting recordings; summary judgment for Bayview vacated and James’s SJ denied |
| Standing of assignee (chain of title/assignments) | Assignments to Bayview conveyed enforceable interests through the chain | Assignment(s) transferred only a previously released interest; assignee lacks standing | Court: Standing unresolved on this record; remand to determine based on assignment language and factual findings |
| Denial of leave to amend/clarification after SJ | SJ made amendment moot; trial court appropriately declined | Denial of leave to amend was an abuse because SJ is vacated; trial court must consider amendment | Court: Vacated denial of leave as mootified by SJ reversal; remand for substantive ruling on James’s motion to amend |
Key Cases Cited
- ABN AMRO Mortgage Group, Inc. v. McGahan, 237 Ill. 2d 526 (Ill. 2010) (foreclosure is quasi in rem; historically required personal representative for deceased mortgagor)
- Espinoza v. Elgin, Joliet & Eastern Ry. Co., 165 Ill. 2d 107 (Ill. 1995) (summary judgment inappropriate where reasonable persons could draw divergent inferences)